Summary
Apple Inc.'s 2007 10-K filing showcases a company experiencing robust growth and strategic expansion, primarily driven by the success of its iPod and the highly anticipated launch of the iPhone. Net sales increased by a significant 24% year-over-year, fueled by strong performance in Mac sales, particularly portable computers, and a notable 8% increase in iPod net sales. The introduction of the iPhone, while contributing a modest $123 million in net sales for its initial partial year, signals a major new growth vector for the company. Apple's retail strategy continues to be a key driver, with a 27% increase in retail net sales and improved average revenue per store. The company demonstrated improved profitability, with gross margin percentage rising to 34.0% from 29.0% in the prior year, attributed to favorable component costs and higher revenue leverage. Research and development spending increased by 10% to support ongoing innovation, and selling, general, and administrative expenses rose by 22%, largely due to increased sales and retail expansion. Apple ended the fiscal year with a strong cash position of $15.4 billion, providing ample resources for future investments and operations. The company's diversification beyond personal computers into digital music and mobile communication devices is clearly underway, positioning it for continued growth.
Financial Highlights
27 data points| Revenue | $24.58B |
| Cost of Revenue | $16.43B |
| Gross Profit | $8.15B |
| R&D Expenses | $782.00M |
| SG&A Expenses | $2.96B |
| Operating Expenses | $3.75B |
| Operating Income | $4.41B |
| Net Income | $3.50B |
| EPS (Basic) | $0.14 |
| EPS (Diluted) | $0.14 |
| Shares Outstanding (Basic) | 24.21B |
| Shares Outstanding (Diluted) | 24.90B |
Key Highlights
- 1Apple reported a 24% year-over-year increase in net sales, reaching $24.0 billion for fiscal year 2007.
- 2Mac net sales grew by 40%, outpacing the overall personal computer industry growth, with portable Mac sales showing particularly strong momentum.
- 3iPod net sales increased by 8%, driven by higher unit sales of iPod shuffle and nano, despite a lower average selling price due to product mix.
- 4The launch of the iPhone in June 2007 contributed $123 million in net sales, marking a significant entry into the mobile communications market.
- 5Gross margin improved significantly to 34.0% from 29.0% in the prior year, benefiting from favorable component costs.
- 6Apple's retail store expansion continued successfully, with net sales increasing by 27% and reaching $4.1 billion.
- 7The company maintained a strong balance sheet, ending the fiscal year with $15.4 billion in cash, cash equivalents, and short-term investments.